Our guest blogger, Lucy Glynn, is a writer and activist based in Leeds.
The global financial crisis, climate change, poverty and BP: the extent of the problem is clear. But what is the best way to solve it? This was the question asked at the first Steady State Economy Conference held in Leeds on June 19.
The conference was organised by Economic Justice for All (EJfA), a Leeds economics and sustainability debating group and the Center for the Advancement of the Steady State Economy (CASSE), with the aim of coming up with some concrete policy recommendations.
“If the leaders of the main political parties in the UK are not thinking seriously about an alternative to economic growth, then we the people must urgently start and develop the discussion,” Dr Lorna Arblaster, of EJfA, explained.
It was a discussion that was urgently needed. The conference attracted over 250 academics, economists, community organisations, activists, NGOs and business people who played as much a part in making the day a resounding success as the keynote speakers: Peter Victor, author of Managing Without Growth and Professor in environmental studies, York University, Canada; Andrew Simms, Policy Director at nef; Dan O’Neill, European Director of CASSE; and Tim Jackson, author of Prosperity Without Growth and professor of sustainable development, University of Surrey.
Peter Victor opened the conference by challenging our “fear of a no growth disaster” and reminding us that until 1950 there was no discussion of economic growth as something to strive for.
“Can we have full employment, no poverty, fiscal balance, and reduced greenhouse gas emissions without relying on economic growth?” he asked. “You bet!” was his resounding reply, which he backed up with a detailed computer model.
Participants were then asked to put forward alternative policy recommendations in expert-led workshops on how this could be done in the UK.
These included eight policy-focused workshops: limiting resource use; stabilising population; reforming the monetary system; maintaining low unemployment; distributing income more fairly; changing business practices; measuring quality of life and achieving a successful UK transition within a globalised economy, as well as two process workshops: changing consumer behaviour and engaging politicians and the media.
Well-being and work-life balance were key themes of the day as was reconnecting with ourselves, reconsidering what it means to be human and deciding what we really want from our lives. And as Andrew Simms reminded us, not forgetting to have fun.
The conference was just the start. The ideas and proposals which were discussed in the workshops will be collated into a manifesto, which will outline how to achieve a steady state economy in the UK and will form the basis for the movement’s next step.
So what of Leeds now that the steady state caravan has left? There’s a buzz in the city; people who missed the conference feel that they’ve lost out and others who had never heard of a steady state economy have seen the local media coverage. With all the crises and government cuts they may even be starting to question whether there is another, better way.
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29 June, 2010 at 3:50 pm
David Chester
On the subject of distributing income more fairly, I hope they were aware of the social injustice that land ownership brings and considered a taxation reform to elimanate the benefits and rent which are gained by doing nothing, that land-owners enjoy.
By paying this rent as a tax it will no longer be worthwhile for them to continue to hold land out of use (for speculation in its value) and cause the cost of production on the rest to be so high. Thus the correction of this item of social injustice can benefit our society in many ways including the increase for demand in consumer-goods and an end to unemployment etc.
14 ASPECTS of LAND-VALUE TAXATION affecting Government, Land Owners, Community and Ethics
3 aspects for GOVERNMENT
1. Most of the ground-rent being collected as LVT, adds to the national income. It allows the other taxes on earnings, purchases and family/corporate ownership of buildings to be reduced and eventually to be eliminated.
2. The ownership of each land parcel is registered. Then the cost of collecting the LVT is much smaller than for income tax and other production-related taxes. Using regularly updated maps, the rental value of each site (as if without buildings) is public knowledge. Then the LVT is simple to understand, the amount of tax is easily found and its payment by the land owner is impossible to avoid.
3. With LVT, the national economy stabilizes and no longer experiences the 18 year housing boom and bust cycle, which was due to the changing prices that arose from speculation in land-values during town expansion.
6 aspects affecting LAND OWNERS
4. LVT is progressive, the owners of the most potentially productive sites pay the most tax. None is paid on marginally productive sites, since their owners cannot claim ground-rent from possible tenants.
5. The land owner pays his LVT regardless of how the land is used. When the land is leased to tenants most or all of the resulting ground-rent is the tax.
6. LVT stops the speculation in land prices because any withholding of land from proper use is too costly.
7. The introduction of LVT reduces the sales price of sites even though their value (or potential usefullness) may continue to grow.
8. With LVT, land owners are unable to pass the tax on to their tenant renters, due to the competition for land use. The users of (untaxed) marginal sites price their produce according to the costs of their labour, the use of the durable capital and the added transport needs. Owners/occupiers who access more productive land pay LVT/ground-rent and compete in their production, so this tax cannot be added to what buyers willingly pay.
9. With the introduction of LVT, land prices will drop. Speculators in land values will tend to foreclose on their mortgages and to withdraw their money for reinvestment. Depending on the rate of these changes, bankrupcies can result. Then LVT should be introduced gradually to allow the investors sufficient time to transfer money to company-shares in durable capital goods, where their greater use will meet the increased demand for produce (see below).
3 aspects regarding our COMMUNITY
10. With LVT, there is an incentive to use land for production, rather than it laying idle or being partly used. An optimum amount of urban land is brought into use, which reduces the spread of suburbs onto rural land and avoids vacant city centers.
11. With LVT, greater working opportunities exist due to cheaper land and a greater number of available sites. Consumer goods become cheaper because entrepreneurs have less difficulty in starting-up and running their businesses. Demand grows, unemployment decreases and with it a reduction in the polarization of our class-society and its degree of poverty.
12. As LVT is introduced, investment money is withdrawn from land and placed in durable capital goods. The investors in company shares tend to be wage-earners (as well as banks and monopolists). Their decisions favour more competition and cheaper local production without heavy transport costs, whilst the monopolists have less control of prices and the unavailability of alternative goods. This is a natural trend of our free-marketing social system.
2 aspects about ETHICS
13. The collection of taxes directly from productive effort and commerce is socially unjust. The associated philosophy favours coercive robbery and is “Robin Hood” in style. LVT replaces this form of extortion by gathering the surplus rental income which comes without exertion. Consequently LVT is a natural system of money-gathering, which avoids the present-day distortion of business economics.
14. Bribery and corruption cease with LVT. Before, this was due to the leaking of news of municipal plans for housing development. However, the speculation in land values is no longer worthwhile after LVT is in place.